NEW DELHI (AFP/Reuters) - Indias new government said Saturday it was ready to extend the hand of friendship to Pakistan and that it was up to Islamabad to take the first step towards better ties by cracking down on militants on its soil. Somanahalli Mallaiah Krishna, who was named Indias Minister for External Affairs earlier in the day, said the governments policy was to boost ties with neighbours, including Pakistan, and he would like New Delhi to be able to make peace with Islamabad. We would like to live in peace with our neighbour... that has been our desire and we are pursuing that, Krishna, 77, told his first news conference in the job. Pakistan and India began a peace process in 2004 but it ground to a halt after New Delhi blamed last Novembers attacks in Mumbai on the Pakistan-based organisation Lashkar-e-Taiba (LT). We stand ready to extend our hand of friendship and partnership to Pakistan, he said. They (Pakistan) should take determined and credible action to dismantle the infrastructure of terrorism operating from their territory that has been the stumbling block (in improvement of bilateral ties). It is for Pakistan to take these necessary steps so that all of us can live in peace, Krishna said, referring to the Mumbai carnage. We cannot change our neighbours, the politician added, announcing the policies of the Congress-led government, which scored a resounding victory in month-long general elections. Krishna did not comment on a report in the US Wall Street Journal that the Central Intelligence Agency (CIA) had arranged for the two South Asian nations to pool information on the LT. In a statement read out by him on the occasion, Krishna said, I am deeply honoured to assume the charge of the high office of the Minister of External Affairs. We are at a moment in history when the world situation is rapidly changing and India, as a responsible power, must engage actively with the world. I am deeply conscious of the opportunities available to us and the difficulties that we face as we continue to pursue our independent foreign policy of peace and development, and strengthen our strategic autonomy. In the coming years under the stewardship of PM Manmohan Singh, we require peace and tranquillity in our extended neighbourhood and supportive international environment. I accord highest priority to strengthen our political, economic and cultural relations with our neighbours and look forward to visiting them soon. Earlier, Indian PM Manmohan Singh distributed key cabinet portfolios after the Congress partys resounding victory in national elections. Singh named outgoing foreign minister Pranab Mukherjee, 73, regarded as one of Indias canniest politicians, to head the finance ministry to steer the revival of the economy which has slowed as a result of the global financial crisis. Singh brought in a new face to the cabinet as External Affairs Minister - Somanahalli Mallaiah Krishna, party veteran to guide Indias foreign policy during a period of heightened tensions with neighbouring Pakistan. Palaniappan Chidambaram, seen as having overhauled Indias security in the wake of the attacks on Mumbai last November that left 166 dead, will continue to head the Home Ministry, a government statement said. AK Anthony will retain charge of the Defence Ministry, said the statement, which added the new parliament would convene June 1. Sharad Pawar will keep the Agricultural Ministry while Mamata Banerjee will serve as Railway Minister. Portfolios of other ministers will be announced later, a government spokesman said without elaborating.